a senator: mr. president? the presiding officer: the senator from nebraska. mr. sasse: i ask unanimous consent to vitiate the quorum call. the presiding officer: without objection, so ordered. mr. sasse: i ask unanimous

consent the senate proceed to consideration of calendar number 452, s. res. 442. the presiding officer: the clerk will report. the clerk: calendar number 452, senate resolution 442, condemning the terrorist attacks in brussels and so forth. the presiding officer: without objection, the senate shall take up the measure. mr. sasse: i ask unanimous consent the resolution be agreed to, the preamble be agreed to and that the motions to reconsider be considered made and laid upon the table with no intervening action or debate. the presiding officer: without objection. mr. sasse: i ask unanimous consent the senate proceed to the immediate consideration of calendar number 449, s. res. 394. the presiding officer: the clerk will report. the clerk: calendar number 449, senate resolution 394, recognizing the 195th anniversary of the independence of greece, and so forth. the presiding officer: without objection, the senate shall proceed to the measure. mr. sasse: i further ask that the resolution be agreed to, the

preamble be agreed to and the motions to reconsider be considered made and laid upon the table with no intervening action or debate. the presiding officer: without objection. mr. sasse: i ask the chair lay before the senate the message to accompany s. 1523. the presiding officer: the clerk will report. the clerk: resolved, that the bill from the senate, s. 1523, entitled an act to amended the federal water pollution control act and so forth and for other purposes do pass with an amendment. mr. sasse: i move to concur in the house amendment and i ask consent that the motion be agreed to and that the motion to reconsider be considered made and laid upon the table. the presiding officer: without objection. mr. sasse: i ask unanimous consent the senate proceed to the consideration of s. res. 463 submitted earlier today. the presiding officer: the clerk will report. the clerk: senate resolution 463, honoring the memory and service of omaha police officer kerrie orozco. the presiding officer: without objection, the senate shall proceed to the measure.

mr. sasse: i ask unanimous consent the resolution be agreed to, the preamble be agreed to and that the motions to reconsider be considered made and laid upon the table with no intervening action or debate. the presiding officer: without objection. mr. sasse: i ask unanimous consent the senate proceed to the consideration of s. res. 464 submitted earlier today. the presiding officer: the clerk will report. the clerk: senate resolution 464, commemorating the 75th anniversary of the alaska state troopers. the presiding officer: without objection, the senate shall proceed to the measure. mr. sasse: i ask unanimous consent the resolution be agreed to, the preamble be agreed to and that the motions to reconsider be considered made and laid upon the table with no intervening action or debate. the presiding officer: without objection. mr. sasse: i ask unanimous consent that when the senate completes its business today, it adjourn until 2:00 p.m. monday, may 16. following the prayer and pledge, the morning business be deemed expired, the journal of proceedings be approved to date and that the time for the two leaders be reserved for their use later in the day. further, that following leader remarks, the senate be in a

period of morning business until 4:30 p.m. with senators permitted to speak therein for up to ten minutes each. finally, that the morning business -- finally, that following morning business, the senate proceed to executive session as under the previous order. the presiding officer: without objection. mr. sasse: if there is no further business to come before the senate, i ask that it stand adjourned under the previous order. the presiding officer: the senate stands adjourned until >>

and. >> after that meeting speaker ryan held debris the end here is a portion of his remarks. >> with the statement put out a few minutes ago this is just a statement to beat hillary clinton that is true. >> is that the only point does unity you're having trouble passing a budget

here in the house had you think of what trump is talking about with policy? >> i do we have a very encouraging leader it is no secret we had our differences we talk about those today. batted is common knowledge but the question is what is it we need to do to unify the republican party of all the conservative wings of the party? it is important discuss our differences but also to discuss the core principles like the constitution and separation of powers of the fact we have an executive going way beyond the boundaries of the constitution and how it is important to restore article one of the constitution. talking about how strongly be feel about this. i was very encouraged with

what i heard from donald trump today. i do believe that we're not handing the seeds to get ourselves unified to bridge differences so from here we will go deeper into policy areas to see where the common ground is to make sure we're operating of the same core principles. yes. our first meeting and was very encouraged but this is a process and takes time. you don't put it together in 45 minutes. that is why we had i been a very good start to the process. >> so we read that statement as well and i'm a little confused by your endorsing donald trump? >> if you're not voting for hillary clinton? >> it is the process to unify a the republican primary perhaps one of the

most divisive primaries in history take some time there are people who wore for donald trump or john kasich or marco rubio. it is very important we don't pretend or fate unification but truly unified so we have full strength in the fall. no one test to have a fake unification process and want to make sure we understand each other and are conservative priiples that built this country and again i am very encouraged for i have heard a lot of groups from a the presumptive nominee to regina differences of opinion. there is no two ways about it. they disagree on policy disputes those are the kinds of things that we discuss. >> this is going in a

positive direction and is very encouraging but in 45 minutes with all those issues and principles that we talk about. >> what about moderating the campaign? >> no fence and not want to litigate that to the media you have a sense of trust between one another.

>> what we are concerned read this not how much money the you have and how did you get it? something that was fair or through a process? would you try to equalize people who were there many honestly that is not a fair way to treat people. >> the american dream is not threatened by in kind equality and interviewed. >> this is not about me or roosevelt here he is on the political spectrum as a call to action. to inspire and motivate

americans of every generation what makes america special and that is worth fighting for. some of us carry a rifle some still do but you don't have to carry a rifle to be in the arena. and to perpetuate an experiment of human freedom. >> there should be a serious but instead filled with budgetary tightropes and ethical disappearing acts instead we are so fatigued with the skeletons coming out of the of closet that we are exhausted by the new legislators before they even have their chance to start their jobs.

[inaudible conversations] with my top emergencies management priority to launch a public policy of of disasters with volos of property and human life. we follow that hearing with

several round tables to help us understand what disasters cost and who paid those in other the problem is getting better or worse. early last year their ranking member and i introduce the disaster reform act with the first comprehensive assessment of though losses of over 20 years. we also want to reform the federal assistance disaster program to make them more efficient and effective. >> as a result, the private sector and government are

spending an ever-increasing amount of money on disasters. fema alone has obligated more than $178 billion since 1989 for over 1,300 presidential disaster declarations. in addition, the number of federal disasters is going up. take a look at this graph that shows the steady increase in the number of presidential disaster declarations since 1953. many have suggested, including the general accountability office, that the growth in the number of disaster declarations may be causing the increase in federal disaster costs. but when we had the congressional research service look more closely at the data, they found the growth in declaration is driven by small disasters, and they represent a very small part of federal disaster spending. in fact, 75% of all declared

disasters account for only 7% of costs. in other words, we could eliminate three-quarters of all federally-declared disasters and barely cut 7% of federal disaster spending. i would argue the amount saved by eliminating those disaster declarations certainly would not outweigh the benefit those declarations provide to helping our smaller, remote communities respond to and recover from disasters. in order to understand why disaster costs are going up, we need to look at the big disasters since that is where over 90% of the money goes. since we started looking into this issue, we have also found the role of the federal government in covering disaster losses has increased. as we can see here, federal disaster spending as a share of total disaster losses has grown from 23% during hurricane hugo

in 1989 to 80% during hurricane sandy in 2012. in recent years significant disaster aid has been provided outside of fema's disaster assistance programs. these charts show how disaster aid programs outside fema have grown. in fact, for hurricane sandy there was less fema assistance than from either the department of housing and urban development or the department of transportation. we found that these additional disaster aid programs don't have the same requirements and restrictions as the fema assistance. fema assistance is tied to actual disaster damage and is for individuals, governmental entities or certain nonprofits performing government-like funks. fema only spends money on eligible items for eligible applicants no matter how much money fema receives.

fema mitigation funds must be used on cost beneficial projects to insure the federal investment is a wise one. fema makes every effort to get money into the hands of applicants as fast as possible to enable rapid recovery from disaster impacts. in the most recent data provided by the sandy program management office from march 2016, it appears that these agencies have been slow in awarding and especially paying out funds. based on this data, only to one-third of the cdbg dr funds have been dispersed and only 15 percent of the other funds paid out. this certainly shows why a comprehensive look into disaster spending as well as cost and losses is needed. in an era of growing government debt, we need to insure federal

spending is necessary and cost effective. right after i became a member of congress in 2011, my own district was hit hard by hurricane irene and tropical storm lee. i remember in blooms burg a family stayed -- blooms berg a family stayed in their home, but the creek rose too quickly. the house next to theirs was knocked from its foundation. water started gushing through their front windows as they called for help. they had to be saved by a helicopter. the woman there told me she could never live in that home again. i will never forget that. preparing for natural disasters is about more than the loss of possessionings. it's our friends -- possessions. it's our friends' and neighbors' lives that could be at stake if we do not plan in advance. as we were rebuilding, i was amazed that much of the federal assistance was to rebuild in the same place, in the same way, leaving people vulnerable to the next storm.

the federal government has a responsibility to respond after a disaster, but we also have a duty to be good stewards of the taxpayer dollar. i look forward to the conversations we have today, the ideas we are going to hear about and taking the next steps to reduce the cost of disasters, and i thank you all for being here. i ask unanimous consent that members not on the subcommittee be permitted to sit with the subcommittee at today's hearing, offer testimony and ask questions. and with that, i now call on ranking member of the subcommittee, mr. carson, for a brief opening statement. >> thank you, chairman. great words. good morning, everyone, and welcome to today's hearing. while we have several prominent witnesses today, i would especially like to welcome a fellow hoosier, mr. kevin mickey, from the great hoosier state. mr. mickey is the director of

the poll lis institute at purdue university in indianapolis. he's also the new chair of the national institute of building sciences. i look forward to my colleagues learning about the work being done in the great hoosier state, particularly indianapolis, to address rising disaster costs and losses plus the latest report from the multihazard mitigation council. mr. mickey's national leadership and his local work are terrific examples of what indianapolis is doing in the field of emergency management. i yield back, mr. chairman. >> thank you, ranking member carson. we will have two panels of witnesses today. on our first panel, we have our fellow subcommittee member, carlos curbelo, from south florida. he knows all too well the risks posed by natural hazards, the rising costs of disasters and the efforts that have proven successful in florida to incentivize mitigation measures and smart behaviors. congressman curbelo has been a

great advocate for his constituents. on our second panel, we'll be joined by the deputy administrator of the federal emergency management agency, or fema, who has been working on ways to reduce the costs of disasters and build resilience in communities to avoid disaster losses. ms. sally clark, missioner of el paso -- commissioner of el paso county, colorado. she is here in her capacity as president of the national association of counties. mr. brian coon, director of the florida division of emergency management and the president of the national emergency management association. he is here to talk with us about his experience as well as help us see things from a state perspective. mr. eric nelson, vice president, catastrophe strategy and analysis for the travelers companies incorporated, representing the build strong coalition. mr. kevin mickey, chair of the multihazard mitigation council of the national institute of building sciences.

i ask unanimous consent that our witnesses' full statements be included in the record. without objection, so ordered. we have hoped that chief david paulson, the former administrator of fema, would be able to join us, but he had other commitments. i do have a written statement from the record from administrator paulson. i thank him and the bill's strong coalition for their input on these important topics, and i ask unanimous consent that this statement be included for the record. without objection, so ordered. for our witnesses here, since your written testimony has been made a part of the record, the subcommittee would request that you limit your oral testimony to five minutes. congressman curbelo, you may proceed. >> chairman barletta, ranking member carson, members of the committee, thank you for the opportunity to testify before you today. this is my first time testifying before congress, and i'm glad to do it here at the transportation subcommittee on economic development, especially to

discuss the important topic of disaster mitigation. i'm honored to serve with all of you. i'd like to take the opportunity to share some thoughts on controlling the rising costs to the federal government when responding to disasters. i'm a native of south florida, and my good friend, mr. serious, who is working with me on issue, is from new jersey. we both have a deep and personal understanding of the devastating impacts of natural disasters on faminglies and communities -- families and communities and have seen firsthand what happens when homes, schools and businesses aren't built to withstand the forces of nature. my family and i lived through hurricane andrew back in 1992. fortunately, in my part of town the damage was not extreme, but just a few miles south where some of my family members lived, the devastation was horrifying. being a floridian, i know that we have pretty strong state building codes already on the books.

but at the national level, it is time to fix the broken federal system that is riddled with red tape, waste, fraud and abuse. there's some great work already being done in the field of pre-disaster mitigation, and i'd like to thank chairman barletta for being a strong leader on the issue. over the last 30 years, we have seen a significant increase in federally-declared natural disasters. but instead of taking additional steps to focus more on preparing for these disasters with enhanced building codes to make communities safer, the federal government typically waits until after a disaster occurs to react. this is incredibly dangerous and costly, especially with the increase in extreme weather events. according to the weather channel, this hurricane season is supposed to be the most active since 2012, so this hearing and these issues are of the utmost importance and very

timely. for these reasons my friend, mr. sears, who knows firsthand in new jersey just how costly clean up is after a disaster and i have worked to introduce legislation to work towards stronger building codes at the national level by introducing h.r. 5177, the national mitigation investment act of 2016. this legislation works to alleviate losses to resident and commercial property following a natural disaster new preventative measures. it would provide incentives for the adoption and achievement in enforcing state building codes. we do this by allowing the president to increase mitigation assistance following a natural disaster by 4% based off of the price of clean-up but only if the state is enforcing building codes. this incentive can encourage states and localities to be proactive in future building and also save a lot of funds in the long run. the bill would also create a

pilot program to award grants to state and local governments to encourage the adoption and enforcement of nationally-recognized building codes. the goals of the grant program are to reduce disaster response and recovery costs by increasing resilience of buildings and reducing the amount of damage that occurs due to disaster and chronic flooding. grant awardees will be required to accomplish these goals with non-federal matching funds, no less than 25%, and fema will be required to provide reports back to congress on the success of the program. mr. chairman, the residents of both florida and new jersey have had to rebuild communities after the devastating effects of catastrophic natural disasters. returning to a life of normalcy is tremendously difficult and can take many years. furthermore, chronic tidal

flooding poses a significant threat to real estate along our waterfront communities, especially in my south florida district and the constituents that mr. sears represents as well. undoubtedly affects insurance -- this undoubtedly affects insurance rates, property value ares, clean water supplies and general public welfare. we believe that through preemptive methods of incentivizing state and local governments to adhere to stronger building codes, we will alleviate the burdens and costs of the federal government after a natural disaster. i thank my friend, mr. sears, for working with me on this legislation. i look forward to hearing from other experts on the issue of disaster mitigation in the next panel. this is a topic that requires perspectives from diverse geographic allocations and -- geographical locations, and i appreciate being able to discuss my bill today. thank you very much, mr. chairman. >> thank you for your testimony, congressman curbelo.

i will now begin the first round of questions limited to five minutes for each member. if there are additional questions following the first round, we'll have an additional round of questions as needed. while we usually do not have questions for members of congress, mr. sears is an original co-sponsor of mr.curbelo's legislation and has a few questions. >> i really thank you, mr. chairman. i'm not going to ask mr. curbelo questions because we've been working on this for a while. but i do want to thank you. you and i have firsthand experience in how devastating some of these catastrophes are, how it impacts life, the community, the economy. and i really want to thank you for taking strong lead on this. you and i -- new jersey got hit hard, florida's been hit hard, and i just want you to know that i think this is the way to go. you know, investing in mitigation especially on a

national level where we can put some real, strong codes has always been on my mind for many years, so i just want to thank you for your hard work, and i look forward to continue and be proud to work with you on this legislation. thank you very much. thank you, mr. chairman. >> thank you. are there any questions? mr. costello? no? thank you. ranking member carson? if not, we thank you very much for your testimony. your comments have been helpful to today's discussion. we will now call our second panel. i remind you of the subcommittee's request to limit your oral testimony to five minutes, and we'll give everyone a chance to be seated.

[inaudible conversations] >> thank you very much. deputy administrator anymoric, you may proceed. >> good morning, chairman barletta, ranking member carson and members of the subcommittee. i'm the deputy administrator for the federal emergency management agency. thank you for this opportunity to testify about the efforts fema's undertaking to reduce the rising costs of disasters. with the continued trend towards urbanization particularly in large cities located in high-risk areas and the increasing severity of weather events, the nation faces the potential for ever-increasing costs in responding to and recovering from disasters. during a disaster response,

fema's primary goal is to support the survivors through effective, efficient operations. though fema has procedures in place to control costs during a response, one of the most effective ways to reduce disaster costs is to invest in community reis sill yens before -- resilience before a disaster strikes, thereby reducing the physical and financial and particularly the human impacts of the event. preparedness and mitigation investments made before a disaster strike significantly lessen the financial impacts on community, statements and the nation. one of the most effective tools is establishing stringent building codes and standards that insure the property is built to insurable levels. let me repeat that. building codes and standards that insure the property is built to insure bl levels. you'll hear multibl times today that for every dollar invested in mitigation, a savings of $4 is achieved post-disaster.

reducing costs to the american public by an estimated $3.4 billion annually. i have to thank this committee and the congress for taking actions such as the post-sandy legislation where we were able to move the recovery costs forward based on a assessments but add the mitigation costs at that time so that the building back is better and reduces the future potential. fema has made significant strides in the last few years bringing the larger emergency management communities together around a national preparedness system. this provides communities a common approach to managing the risks and provides communities the information, tools and funding they need to make of informed, data-driven decisions. this is just one step fema takes in promoting resilience. the national flood insurance program serves as the foundation for the national efforts to reduce loss of property from floods, the most costly and

frequent disaster in the united states. the program identifies areas at risk for flooding and makes flood insurance available to participating communities. within the nfip, the community rating system initiatives, communities who implement floodplain management practices offering lower nfip insurance premiums to participating communities. additionally, fema provides hazard mitigation assistance through programs such as pre-disaster mitigation, flood mitigation assistance, hazard mitigation grant programs. these provide funding to communities to implement hazard mitigation measures pre and post disasters. programs such as the nfip and the community ratings system and hazard assistance is before the disaster strikes. i strongly -- this year fema went a step further, developing the disaster deductible concept which encourages states, tribal and territorial investment in resiliency mitigation programs.

i strongly believe this program will be critical to any effort to reduce future disaster costs in a significant way. as you've indicated, congressman barletta, congress, the gao and others have indicated that the federal cost of disasters continues to rise. the solution of moving the threshold higher merely distributes the cost differently but does not reduce the cost of potential disasters. with the disaster deductible concept, states would have to meet a predetermined financial commitment similar to meeting an insurance deductible as a condition of receiving federal funds to rebuild damaged facilities and infrastructure. additionally, fema would provide credits for those states, investments in resiliency measures such as adopting the building enhanced codes or funding preparedness and mitigation projects. using these credits, a state's deductible could be reduced,

thereby insuring communities have an incentive for investing in resilience. during a 60-day comment period, fema received 150 responses. we're currently evaluating those to provide input from the advance notice of proposed rulemaking to develop a proposed rulemaking for later this year. while preparedness and mitigation efforts can help reduce costs in many areas, demographic patterns are not something we can easily or readily influence, but we can take steps to account for these patterns by improving building codes, promoting preparedness. fema strives to invest in our nation's resilience and support disaster survivors while being good stewards of the taxpayers' dollars. we continue to look for innovative ways to promote preparedness and mitigation planning and efficiently implement the recovery programs in order to reduce 3w0e the risks and costs to the american taxpayer.

thank you for this opportunity today to testify, and i look forward to any questions the subcommittee may have. >> thank you for your testimony. commissioner clark, you may proceed. >> thank you, chairman barletta, ranking member carson and members of the subcommittee, for the opportunity to testify before you today on the cost of disasters. my name is sally clark, and i'm a county commissioner from el paso county, colorado, and also serve as the president of national association of counties which represents all of america's 3,0699 county governments. although all parts of government play a role in disasters, counties often serve as the first line of defense when a disaster strikes and are responsible to help our communities recover in the aftermath. whether it's our emergency managers or sheriffs or 911 call centers, county hospitals or public health departments or the fact that we own the majority of our nation's infrastructure like roads, bridges and airports, federal policy decisions have a

major impact on counties. my county is no stranger to disasters, and the topic of this hearing is personal for me. over the past several years, el paso county and our surrounding areas have been devastated by a series of wildfires and flash floods that have upended our residents' lives, strained our local economy and caused enough damage to prompt four presidential disaster declarations over a three-year period. our county which long ago inspired katherine lee bates to write the famous hymn, "america the beautiful," is now home to charred, barren hillsides, and the vegetation that once protected the area from stormwater runoff has disappeared, paving the way for dangerous flash floods. but we have been working to help our community recover and become more resilient in the future. today i respectfully submit three principles for your consideration as you continue to discuss federal disaster spending.

first, federal disaster spending should be viewed in the context of corresponding spending by state and local governments, and the capacity of each level to fund disaster recovery effortses. thousands of disasters strike our nation each year, and the vast majority of long-term recovery costs are carried on the backs of state and local governments. according to our analysis of fema data, over the last ten years 92% of counties across the nation had at least one fema-declared disaster. and according to materials published by fema, the number of disasters successfully handled without request for federal assistance is estimated at 3,500 to 3,700 annually while only about 35 disasters per year received major declarations triggering federal assistance between 1953 and 2014. furthermore, it is important to consider the respective fiscal capacity of federal, state and

local governments when assessing contributions to our nation's recovery from disasters. county governments in more than 40 states operate under restrictive revenue constraints imposed by state policies including caps on property taxation that limit counties' ability to raise additional funds in the face of rising disaster costs. local governments spend significantly on disasters, and changes to federal disaster spending should not be assessed without consideration of this. second, decreases in federal disaster spending should not come at the expense of state and local governments. the ultimate result of shifting federal costs to state and local governments will further deplete resources available for proactive disaster mitigation and resiliency work, resulting in even costlier disasters in the future. fema's disaster deductible proposal presents serious challenges for local governments. for example, el paso county has spent millions of dollars on

mitigation projects in the last several years as we have worked to recover from the wildfires and flash floods that have ravaged our community, including loss of life. but under the disaster deductible proposal, if the state of colorado fails to you havely invest in mitigation efforts, public assistance funds could be withheld from our county at times when we are in most need of federal assistance. in this way we could be punished because of the inaction of an entity over which we have no control. despite our best efforts at mitigation. and this is just one of the many issues with this proposal that thus far have not been sufficiently addressed. because of this, fema has not given local governments confidence that a disaster deductible could be implemented without the significant risks that it would simply shift disaster costs from the federal government to state and local governments. and finally, local disaster mitigation efforts bring down the overall cost of disasters and should be supported by the federal government. counties are uniquely positioned

to implement mitigation efforts through our regulatory authorities and convening powers, collaboration with the federal government helps counties better utilize our authorities and resources to mitigate the damage caused by disasters, increasing community resiliency and decrease the impact and cost of future disasters for all level of government. fema's hazard mitigation grant program and the other federal programs enable counties to undertake large mitigation projects that may otherwise be out of their reach and have tremendous potential to drive down the cost of disasters for all levels of government. mr. chairman, ranking member carson and members of the subcommittee, i want to thank you again for inviting a local perspective on this important conversation, and i would welcome any questions. >> thank you for your testimony, ms. clark. mr. koon, you may proceed. >> thank you, mr. chairman, ranking member and members of the subcommittee. my name is bryan koon, and i am director of the florida division of emergency management. i'm here on behalf of the national emergency management association which represents the

state emergency management directors of the 50 states, territories and the district of columbia. as the frequency, intensity and variable about of disasters increase, it is imperative to reduce risk wherever possible. this will focus on life safety and those aspects of the built environment where the risk cannot be reduced everything nema believes the following: meaningful cost reduction should impact all levels. the government practice of spending more money on disaster recovery than risk reduction must be changed. hazard mitigation is a cost effective effort with a documented return on investment. mitigation reduces response costs and speeds recovery. integrating mitigation meaningfully into recovery can be the catalyst for a community-wide focus on preparedness in the future. mitigation and resilience activities by state, local and friable governments should be recognized and incentivized by the federal government. in the long term, cost savings will be realized at all levels.

much of the legal authority and responsibility for risk reduction decisions and activities reside at the local level such as adoption of enforcement of building codes and zoning decisions. all stakeholders must utilize the best available science and predictive analysis tools to illustrate data-driven result on investment calculations. this can only be done when data is made available to all stakeholders and when calculations are not done in a vacuum. we must leverage data to support our risk reduction priorities. fema has undertaken various efforts over last decades to reduce costs and streamline operations. reengineering of the public assistance program is an excellent example of fema working to improve and maximize existing programs. while it is still too early to term the effectiveness, we are pleased with the effort and urge that similar reforms be considered in other federal programs. investment into the emergency management assistance compact

leverages federal grant dollars that have already been invested in state and local emergency management programs. we must encourage greater investment as states work with one another to reduce the need for federal assistance, federal administrative costs, property damage and, most importantly, save lives. in january fema proposed a concept to create a deductible for federally-declared disasters. many expressed these common beliefs about any new proposal: the concept should drive real reduction in costs at all levels and not merely a shift in costs, an appropriate amount of time must be given to insure successful implementation including training and guidance for states. states must also be given adequate time to insure that any budgeting requirements are understood and acted upon by state legislatures. the proposal should utilize the opportunity to decrease administrative burden and associated costs x. the deductible cannot result in delayed assistance to those in need. regardless of what happens with

that or any other current initiative, real progress will be achieved when all critical stakeholders are engaged. i'd like to wrap up with a few thoughts on where we go next. the federal government should continue to allow states to pursue innovative ways to strengthen their communities. we recommend fema and other agencies continually evaluate these programs to better understand the things that deter or prevent communities from fully leveraging these opportunities. nema also recommends that a study to determine the true cost of disasters be conducted that captures not only those direct financial costs borne by fema, but those costs -- both direct and indirect -- that are paid by other federal agencies, state, local and tribal governments and the private sector. position fema as a partner in developing a more resilient nation. fema's focus must transcend response and make advancements in all phases of the disaster cycle. mitigation and long-term recovery are societal investment, not a cost. many of the functions that fema fulfills during a disaster could

be done in a more cost effective manner by using personnel deployed through emac. invest in the infrastructure necessary to achieve this goal. in addition to improving currently-existing federal programs, fema and others should recognize outstanding efforts done by state and local entities and encourage their adoption nationwide. while many stakeholders approach the issue differently, we all have a common goal. as government officials, private sector business leaders and community members, we all have a role to play in reducing the cost and impact of disasters. i appreciate the opportunity to testify before you today and stand ready to answer any questions the committee may have. >> thank you for your testimony, mr. koon. mr. nelson, you may proceed. >> good morning. chairman barletta, ranking member carson and members of the subcommittee, thank you for holding this important hearing today to examine solutions to controlling the increased costs of natural disasters. my name is eric nelson, and i'm senior vice president of catastrophe risk management at travelers insurance.

i'm testifying today on behalf of the build strong coalition, a group of businesses, consumer organizations dedicated to reducing human economic losses from natural disasters. as one of the largest property casualty companies in the u.s., travelers provides a unique private sector expertise that can add value to the federal government's mission in its own risk and losses from natural disasters. i'd first like to thank chairman barletta and the members of the subcommittee for their continued leadership in conducting a series of round tables on this topic beginning in january of last year. i begin today by outlining three major takeaways from that emerging from those round tables x. before i do that, the main question we want to ask ourselves is what actionable steps can congress take to mitigate risk, lessen the impact of families and communities across america and reduce federal losses from natural disasters. the first takeaway from the round tables is that by almost every measure federal disaster

spending is increasing on an unsustainable path. dr. irwin michelle -- [inaudible] showed that exploding cost share of natural disasters increasing from roughly 6% in 1955 to 77 president in 2015 -- 77% in 2015. the second takeaway from the second round table is that states, communities and individuals have little incentive to undertake loss prevention measures before a disaster occurs. we're going to hear the multihas a ard mitigation council conducted a study documenting every dollar spent on mitigation saves the nation approximately $4 in post-disaster relief costs. a new study by wharton indicated that a dollar increase in the individual assistance grant program reduces disaster insurance demand by $6. these findings represent compelling evidence the federal government is inadvertently fostering shortsighted behavior

throughout state and local governments and with individual homeowners. the third point from the round table is that eliminating disincentives and replacing them with the appropriate incentives for mitigation can benefit all parties involved. the federal government would benefit by lowering its cost share for disaster assistance. states would benefit by alleviating the budget constraint caused by disasters and easing their dependency on federal aid. families would benefit by reducing personal disaster costs and protecting loved ones. communities and local economies would benefit by enabling citizens and businesses to recover more quickly after an event. while the benefits are clear, the question remains what specific actions can congress take? the national mitigation investment strategy based on the latest science and engineering research from world class research institutions such as the insurance be institute for business -- insurance institute for business and home safety or ibhs. we conduct research on building

performance standards and simulated disaster conditions in controlled environments. research from these institutions demonstrates that statewide adoption and enforcement of building codes can reduce long-term risk. studies conducted in the wake of major disasters also support this finding. another fact. according to ibhs, at least 25% of all businesses that close down for 24 hours or more during a disaster never reopen. that's taggerring stats -- staggering stats. and think about the businesses and the jobs. another stat we looked at was the lsu hurricane center estimated that stronger building codes would have reduced wind damage in hurricane katrina by 80% or $8 billion. so thank you for your leadership of congressman curbelo and congressman sires. i'm pleased to report that the core principles from this report has been turned into the legislation and introduced in h.r. 5177, the national mitigation investment act.

this act provides a powerful incentive and authorizes a first of its kind competitive grant program to improve building code enforcement. further, the provision authorized by the chairman in h.r. 1471 authorizing congress to look at the first comprehensive assessment of federal disaster spending by congress in over 20 years. congressional leaders, policy experts and gao all agree strong building codes enhance pre-disaster mitigation settings with proof. i urge you and your colleagues to support the act in order to rein in federal government's exploding costs. chairman barletta, ranking member carson and the subcommittee, i applaud you for your efforts and thank you for taking up this issue. i'd be happy to answer any questions. >> thank you for your testimony, mr. nelson. mr. mickey, please proceed.

>> chairman barletta, ranking member carson and members of the subcommittee, thank you for the opportunity to provide testimony on approaches for reducing the costs of natural disasters. my name is kevin mickey, director of professional development and geospatial education at indiana university which has the mission of linking academic and community expertise to create strong and resilient communities. i'm here today as the chairman of the multihazard mitigation council introducing a new and unique approach we have proposed for the incentivization of prove property owners throughout -- private property owners throughout the united states. the congress established the national institute of building sciences in 1974 to serve as an authoritative source for both public and private sectors to improve the built environment. to achieve its mission, the institute has established 18 councils that engage building industry experts in examining and developing tools, technologies and practices to meet identified needs. the institute and its

multihazard mitigation council, or mmc, and council on finance, insurance and real estate have been particularly focusedded on opportunities to advance resilience and encourage the most cost effective approaches to reducing the impacts of natural as well as manmade disasters. as you are aware, there have been numerous efforts at developing increased building codes and standards, mitigation programs, scientific studies of best practices and definitions of resilience, and yet we continue to find the penetration of hazard mitigation into the private sector as spotty and woefully incomplete. this is not to say these efforts have not been effective. this has already been pointed out. a 2005 mmc study showed that strategies do, indeed, save on the order of $4 for every dollar spent. and currently, the institute is discussing with federal agencies and the private sector a project to revisit this 2005 study and expand it to consider all federal programs, the role of the model building codes and the benefits to that mitigation provides to the private sector.

recognizing the significant benefits achieved through proactive investments in mitigation, the limited funding available to the support disaster mitigation response and recovery as well as the anticipated increase in disaster events, a new approach is necessary. the most cost effective manner to achieve resilience is through a holistic and integrated set of public, private and hybrid programs that capture opportunities available through investment and mortgages and equity real estate, insurance, finance, tax incentives and credits, grants, regulations and enhanced building codes and their application. this focus on leveraging private/public sector opportunities to induce corrective action is called incentivization. the incentivization approach calls for input, consensus, leadership and action from a broad spectrum of stakeholders representing the financial, regulatory and economic processes that need to be developed and coordinated to make incentivization part of the nation's economic fabric. participants should include those who offer incentives such

as insurance and finance-related companies, lenders and foundations as well as forward-thinking communities and government agencies and important decision makers that most definitely need to include homeowners, businesses and utilities. the mmc and -- [inaudible] jointly parished and develop -- published a paper based on public and private incentivization which provides a catalog of existing programs for different hazards that private and public sector stakeholders can evaluate and then modify or expand to develop incentives. the specifics of incentivization need to be tailored for new and existing construction using optimal resilience measures beyond current law or custom and to account for hazard, risk, locality, business size and the value of resilience strategies. one size cannot fit all. incentivizing the means to achieve resilience before disasters occur focuses on monetizing the benefits for incorporates risk mitigation in the ordinary course of business. participating stakeholders need sufficient confidence that using

incentives to achieve resilience will justify investment, underwriting and loan and grant programs. the private sector will not undertake it just because it's sensible, but because it's economically prudent. my written testimony describes many opportunities. i offer a few specific recommendations here. first, every federal dollar associated with construction, community development and infrastructure must include a requirement that the latest building codes be met or exceeded. second, congress and federal agencies should examine all programs, particularly grant-making programs to identify opportunities to support resilience. and finally, federal investments and programs should require investment and mitigation. thank you for the opportunity to testify before you today. please consider the polish center as resources as you look to address challenges related to the built environment. i rook forward to your questions. >> thank you for your testimony, mr. mickey.

i will now begin the first round of questions limited to five minutes for each member. if there are additional questions following the first round, we will have additional rounds of questions as needed. deputy administrator nimic, why are the big disasters costing so much money now, and what factors do you think are driving this change? and then i'd also like to hear mr. koon and mr. nelson's thoughts on that. >> congressman barletta, i think the biggest challenge is the continued movement of populations into high urban areas that happen to have been developed from historic perspectives in very dangerous areas along our rivers for flooding, along our coastlines for major storms and on earthquake faults. the reality of people moving to the cities is one that we're going to face for the foreseeable future, and that only increases the potential of cost. additionally, the value of property has gone up

substantially over time, and therefore, the recovery costs have continued to go up. what it costs to build a mile of roads 30 years ago is very different than what it takes to build a mile of roads today. the only solution is, in fact, building for those future states that we look at in terms of culverts that can maintain the now of water, bridges that are better maintained. all of the infrastructure that needs to be there as well as public buildings built to standards that allow for the potential of future disasters to be minimized. substantiate >> if you are moving and growing

in an area with four building code said, versus good codes. we see it in the claims data. where we should not see claims we see claims. at low wind speed and small hail sizes. there is a better way forward and we see that in states like florida that have good adoption of building codes. >> thank you, i conquer with both and i would add i believe over time there has been a better understanding and utilization of the funding available to communities after those types of disasters. we are recognizing the federal, state and local dollars helping the states recover and there is additionalal cost i believe on the programs and the program requirements to affect the recovery and mitigation. the recovery programs can stretch into the decades for the

larger disasters so the administrative cost add to that. >> we continue to see new emergency programs emerge ad hoc. they have different rules and requirements are don't seem well coordinated or focused on maintaining the best outcomes. don't fema programs have strict requirements on use and cost effectiveness? are you aware if other disaster programs include such requirements? is this something congress should look at so we can streamline the programs and make sure they are cost-effective. >> you are absolutely correct, congressman, barletta. we have stringant controls to qualify for federal dollars and they often take a great deal of oversight to make sure they are

effectively and correctly impleme implemented. i can speak from the sandy legislation, there was a desire to capture all agencies to ensure we had a more complete understanding of where the different investments in recovery were going. that is not consistent across all of the different disasters that exist. i will tell you this year for the first time, the administration passed the federal flood risk management standards that require every agency, for every federal dollar that is invested in recovery to meet a standard for the first time including the department of defense as well as all of the other agencies so there are activities going on to try to ensure we all build to a high standard but the capture of those cost is not something we currently do. >> now, recognize ranking member parson for five minutes.

>> thank you, gentlemen. in terms of community buy-in various reports have been released about the rising cost of disaster and the need to take steps to mediate core m mitigation. we authorize fema to provide additional hazard funding to states with enhanced plans but only 12 states have adopted these. how do we get your reports in and what is needed to get ideas implemented? >> just this past january, the institute held a symposium here in washington, d.c. and that institution brought together experts in the industries that i identified in my testimony for the purpose of discussing exactly what was presented and

more importantly to share their own ideas for how to incentivize resilien resilience. the groups include insurance, bond writing organizations, businesses, utilities, home owners and of course local state and federal government. the goal of that counsel is going to be to work on formul e formulateing the mechanisms for incen ince ince incentivazation. the economy doesn't currently exist for writing insurance and generating bonds. the goal we see is to produce a set of products the consumers want. let me give you a couple examples you will find in the full study.

state farm insurance offered a premium discount for instillation of impact-resistant roofs. the result was that products related to impact-resistant roofs went fromtan in 1998 to more than a thousand in 2003 and that program has expanded to 26 additional states. according to state farm home owners, the impact resistant roof product is something they now want. just earlier this week in washington, the mayor of the city of fair hope, alabama, tim made a statement that his community is considered one of the most desirable places to live because their homes are recognized as being more resilient and that is one of the places where the fortified program is found. the institute is planning to serve the role of identifying these solutions that i mentioned.

we recognize there are plenty of best-practices out there. what we want to do is bring together the stakeholders to identify those best practices and see them replicated across the industry. we recognize that cost were high, and we are looking for ways to reduce them, and we believe this is a creative approach. ultimately, we believe that activity was as implementing building codes need to be viewed at a carrot and not a stick and if the incentives are appropriate we believe that can chap happen. >> mr. coon, you mentioned the centric focus as a positive step forward. are there other actions fema could take in order to reduce

disaster costs and even losses? >> i believe continued implementation highlighted in the sandy recovery improvement act in ways that expedite funding to the locals could result in cost savings. we are eager to work with female fema to make sure they are as customer centric as possible so we can help get the communities on their feet as quickly as possible at a minimal cost to the federal government. with regards to the question in regard to incentives, we have done a good job providing incentives. the enhanced incentive program has the community rating system and sandy recovery improvement act for debris removal is another one. none of those are met what they intended to do so continued

evaluation of why they are not being taken up at the level necessary would be good and going back to help them be implemented would help the reach the maximum effect they were designed for. >> thank you. earlier this week the white house hosted a conference on resilient building codes and included in the fact sheet issued by the white house it stated fema is developing a more detailed plan to be put forth in public discussion. has fema determined it will go forward definitely with rulemaking on disaster deductible concepts? if so, when can congress expect the rule to be issued? >> the deductible process has been one where we reached out

heavily to the user group. as ms. clark indicated we have received over 150 very detailed responses to the advance notice of rulemaking and we went through the rulemaking process in order to get tat that type of feedback where there are concerns this might be the ability to transfer cost from the federal government and to state and local communities. the intent is what we have been talking. to incentvise and make it more consistent for communities to invest in mitigation and prepar prepar prepar preparedness capability. we are going through the statements and then through the rulemaking process for specific comments. we anticipate that will be out

sometime this year. >> i yield back. >> mr. graves, you have five minutes. >> thank you. administer nimmich, who is in control of national resilience? >> fema through the national preparedness program provides the guidance for the federal government to assist state and locals in developing their preparedness programs and fema working with states through the threat esmating program as well as their preparedness reports captures that information as well as for the federalment -- federal government. >> do you acknowledge the

statistics referenced in regards to studies showing pro-active investigations in hazard litigation generate cost savings? >> yes, sir i said that in my opening statement and that is what the deductible process is. >> do you see the army core of engineers helping? >> i am not comfortable answering a yes or no. we work closely with the army core of engineers and i do believe a lot of efforts go to reducing the impact of future natural disasters. they are worked with the city of fargo to develop capabilities >> i will go ahead and answer these. so you have the u.s. army core of engineers that spends money in addressing flood damage reduction processes, hurricane

protection, the administration budgeted i believe a billion compenstation relating to hud. there is a fund of two billion trying to be set. fema has a hazard mitigation group program and a pre-disast program. does it make sense having five programs out there attempting to identify the same aspects? i am from south louisiana and we have had more than our fair share of disasters whether it is hurricane katrina or rita coming from the south, record-high levels, hurricane gustavo and ike, and then hurricane isaac. we have more than our fair share of disasters.

and watching fema come in and pick up the pieces afterwards with millions spent by perishes and the state government, the core of engineers, i can think of a project in st. johns and saint charles projects that study has been with the u.s. core of army engineers for over 40 years. my point is everyone wants to reduce disaster spending. everyone does. the solution here, as i think ms. clack and mr. koon noted, the solution is making the principle pro-active investments in making our communities more resilient. we have had fema with the 500 year flood risk management, the division of bigger waters in 2014 and revisions in -- 2012 and revisions in 2014.

we increase the cost sharing of the disaster response. my point is that, making proactive investments is the solution to reduce the overall expenses. we estimate if we spent around 8-9 billion finishing authorized projects in louisiana that was supposed to be built by the u.s. core of army engineers we could have saved an extra 90% and you can guess 120-150 billion spent in response to the 2005 hurricanes. we could have saved that. and more important, mr. chairman, we could have saved over 90% of the 1200 lives that were lost in south louisiana. all of these efforts by fema are being done in a vacuum.

we need to protect and make communities and ecosystem more resilient and stop this coming in after the fact and spending more dollars. all we are seeing rather than following the data and recommendations and outcomes of the studies and experiences falloge the sat catastrophic disasters. i am very concerned about this trend we are seeing. lastly, mr. chairman, i just want to say in south louisiana, much of the vulnerability is attribute today -- attributed to the actions of the federal government. we are lost much of our coast and that is why we are more vulnerable. arkansas doesn't care when hurricanes come because louisiana is their buffer but

our buffer is disappearing. i want to urge the committee as we move forward on legislation, we need to make sure we don't get too myopic in the view and are looking comprehensively at all of the efforts underway that should be under this subcommittee's jurisdiction. i yield back. >> thank you. mr. sears? >> thank you, mr. chairman. we are learned from these disasters, we picked up how to better construct and better code and everything else. why do you think some of these are reluctant to do the mitigation, codes and reinforcement. what do you think that is? >> sorry. i think the decision on building codes is almost always local and those decisions based on other

economic factors, desires for certain develops, but i do think that we as a federal government need to continue to insure that when we invest it is investment in codes. fema has out for comment with our stake holder groups changes to our public assistance program that requires whether a community has code or doesn't. if they don't, and they want us to rebuild it, it will have to be build to national or international code. we are taking it seriously to say even if a community doesn't feel codes are value we do and when we invest federal dollars we wield it back it a code. >> one of the things that bothers we about new jersey is three years later we have people who have not gone back to their home still. there is plenty of game to go around. i think that in terms of the disasters, you not only have to

mitigate it before but i think there has to be some sort of post-disaster where you are ready to come in and watch over the fraudulent applications and everything else and that takes year before we can come up with the people who are perpetrating fraud. to me, i think you have to be ready right after the disasters. can you talk to that? >> yes, sir. i can proudly say we have moved rapidly since katrina to ensure we have programs that have as much protection as possible. but i will tell you we are to err on the side of supporting a valid requirement and a fraudelent requirement is likely to be supported but we do and it takes time to go back and relook, and as you know in new jersey, you are seeing the first cases of prosecution of

fraudulent and people took the money claiming their secondary home was a primary home and taking those dollars away from those people that need it. it does take time. we have to realize that during that immediate post-disaster we want to make sure the people that need to money get. there will be people that take advantagof it but we don't give up. as you said, it may take too long, but we don't stop and we continue to go back and recoop the money from people that fraudulently or accidently applied for resources they didn't deserve. we are below 1% in recovering money so i think we do a good job of insuring the money is going where it needs to go. >> i come around to providing incentives.

if the federal government is going to give you money, i think mitigation code should be part of it. i look at these disasters in the m midwest and see the tornados. oklahoma. i am not trying to single out oklahoma but they get them more it seems. the schools are damage and the federal government is going to give the state money to build a school and you should require a stronger code to build the school. i understand they were built before. but going forward, i think that is something we should look into. some of the schools serve as shelters in some of these communities and i see the damage to some of the schools and homes. i think i am coming around to the idea of incentives, mr. chairman, to provide these people so they can build the kind of code they need to deal

with some of these disasters. thank you. >> thank you. i will now begin a second round of questions. commissioner clark, i understand your district had a number of wildfires that destroyed homes and property. can you talk about the challenging of mitigating post-flooding and do you have any suggestions on improving the programs. >> thank you, mr. chairman. yes, obviously we have had, and i don't know fair share, but we have had more than our fair share of disasters in el paso, colorado. i would like to talk about the standpoint of local community resilience. what happens at the local, state and particularly federal level

is we have silos built up between the agencies. the fire in waldo cannon was almost more than 95% on federal forest land. that premitigation needs to happen from the federal level because that is forest service and the forest service is spending more than 50% of its budget on responding to wildfires versus pre-mitigating ahead of time. we have no control of that at the local level. we have control of working with community wildfire protection plans and providing incentives, as some said up here, which is very important but for individuals to be able to mitigate ahead of time and provide fire wise communities. i was up in crystal park which is a one-way in, one-way out community, and they have taken steps to do that. some of those programs that help them buy fire equipment to be prepared locally to take the

ability to look at providing mitigation will be helpful. when we look at an ounce of prevention is worth a pound of cure and doing the premitiga n pre-mitigation ahead of time. when there is a aast it is hard to understand if you

are not from a western states with the drains that drain into that. tearing down the silos and understanding the impact on shawl businesses. one third of small businesses go out of business after a major incident and i think that is really important and looking at the flexibility in the requirements. we want accountability, but sometimes the requirements preclude you from even asking for the particular money you may otherwise need. >> thank you. we talked a lot today about how much federal government pays out for disasters. but the other payers are insurance companies. mr. nelson, can you talk about insured losses provided to federal assistance provided in the wake of a

>> we are giving you business interruption coverage, and additional living expenses and significant dollars compared to grants or individual grants to consumers. they are not going to be hole gaen and service the home in general. it is important. insurance industry plays a major role in natural disaster. and our trends, because of the weather volatility, you can see the trends going up. this is an important concept. what do insurance companies do? we spread the risk over people and over time. as the risk changes, the prices change. so it is important that we bend the cost curve for the federal government and bend the cost curve for consumers. >> one of you mentioned the importance of mitigation and for every dollar invested four

dollars is saved. most funding is provided through the hazard mitigation grant program after a disaster declaration. how can we more proactively address the mitigation and shift the investment to before the natural disaster? >> i think the first thing need to do is thank the congress and commission that allows the post-disaster money to be identified earlier in the process and applied as part of the recovery process. clearly, as we look at all of the different mitigation programs we have pre-disaster in 2015 congress gave us the authority to do post-mitigation or hazardous mitigation for fire grants to be able to restore those burned areas in a robust

way and i could ask we could reconsider reauthorizing the ability use the fire mitigation grants has a hazard grant. but the reality comes back to how do you incentivize ever level. we believe the deductible offers that opportunity. we continue to work with our stakeholders to define the reasonable deductible and how the investments that the counties and communities do reduce that deductible in order to be able to support those communities that have invested in their own wellbeing. i believe it is mitigation that ultimately reduces the cost of a disaster and we need to find proactive ways as you indicated to incentivize that approach. >> ms. clark?

>> as it relates to the hazard mitigation grant program it is an important component of what i think communities need to be provided for. there are some issues, i think, with the nngp programs that need more flexibility in order to use those funds best at the local level. we see there is not an understanding of unique situations. in 2012 was the oak cannon fire and we just closed on several homes in the floodway as a result of a fire that happened on federal forest land. they had never had flooding before and it took us that length of time to get that completed. as it relates to additionally the hazard mitigation grant program, we at our office of emergency management appreciate being able to utilize those dollars but sometimes where you

may see it as accountability, the paperwork is so extreme for a small mount of money it makes it unusable to apply for a grant. we take it seriously but i think sometimes those programs need to be looked at and how can the dollars get to the folks that need the help and provide additional assistance for those individuals who want to take personal responsibility for trying to reduce mitigation and the disaster -- eventual deck u declaration. the second fire was almost enti entirely on another property. we have two fires and two problems with each of them. >> mr. koon? >> thank you, mr. chairman.

as the director of the florida division of emergency management i have access to a big personal. i have personal we can assign to the funds we receive but a good number of states don't share that luxury and a good number of counties don't have that. every time a program is put in place they have to determine how they can meet the needs of the program because they using current staffing and budget as the potential down the road. i think a few things would be beneficial. one thing would be consider clarifying, consolida solidatin streamline programs. i think a better data analysis of the true cost of disaster and how they impact all levels will help calculate the return on the programs and help make those decisions.

and finally moving the mitigation cycle and program forward so that it isn't something we start thinking about on day one of the recovery. it is something that is done ahead of the disaster so if the funding comes along, we are ready with actionable mitigation plans and we don't rebuild as we were before. >> thank you. mr. nelson? >> i want to start with we have to get the word out about mitigation. there is a perception that mitigation cost so much money to consumers. travelers are a proud supporter of habitat for humanity and went out and built homes along the coastline. the average cost is 2-5 percent on new construction. we just have to make sure consumers understand this. so that is first. second, clearly you have a difficult decision in front of us. spending is so difficult in congress today. everyone understands that.

but we have to consider spending more are pre-disaster mitigation forms and proven techniques by dhs and other studies and evaluate that and evaluate stream lining some of these fema programs. thank you. >> thank you. [inaudible conversation]

>> and taken positive actions. thank you. >> ranking member carson? >> thank you, chairman. mr. clark, disaster assistance reform under the act of 2015, the committee calls for a co comprehensive study on cost and losses. local government as you mentioned bears a large portion of the disaster cost but data is very scarce. what is being done to collect information so the data can be considered as part of the comprehensive study and ensure current federal disaster costs are not just being shifted to local communities? >> that is for me?

i wanted to say that, i think, that brings up -- >> or mr. koon. >> i will start. i think the local government is here to help. we want to know from you how we can best be provide you the data and information for those of us who have done this before and in my case, we had four declared disasters. we have a lot of information and i think it would be helpful to sit down with those communities that have been through the processes and all of the different silos and to be able to have feedback from us on how to change things that policies that may not be working in the best interest of, first of all of, of our communities and secondly of our local governments. >> ranking member carson, the question you ask is a question many of the folks asked as they

were responding to the proposed deductible policy. and that is how do we capture the cost? if you go out and remove a tree on the road overnight or is there a threshold you measure the dollars? we are having the conversation to figure out what cost we need to capture but i believe it is important we do so because it helps feed the return on investment calculations. the flip side of what i offered earlier and the fact i have a fairly large agency and adequate budget, the threshold for florida to receive a federal declaration is fairly high. we can a 25 million disaster in the state of florida that is not eligible for federal declaration. so every year the state of florida spends hundreds of thousands internly to recover from those situations. so we should have methods that

operate on the same sheet of music in terms of the cost. >> mr. nelson, you mention in your testimony, the insurance business home safety program stimulating disasters on a control environment, what type of adjustments to building codes has the institution found to be most efefeceffective in keeping structure standing after a disaster and how much do the changes cost during new construction? >> we have a program called fortified bronze program that focuses on the roof deck. keeping the seams on the roof deck prevents water intrusion if you lose your shingles. that is the first step and second is bolstering opens and covering them.

and the gold standard is looking at the building end to end. how it is anchored to the foundation, through the walls, and to the roof. these are techniques some states embraced. the coast of alabama embraced the fortified standards and put in a program for a mitigation grant. >> the polis center provides valuable services necessary to understand the disasters and risks. how do they help us understand the services known to others and can you expand on the successful projects of state and federal entities that the center has taken? [inaudible conversation] >> thank you for the opportunity to talk about the center and

quite honestly the state i am very proud of the state of indiana. we have been around since 1989, 27 years of successfully linking community and academic experadvertise -- expertise. we have done a lot of work in emergency management but the reason we have been successful is not because of the resources in the center uniquely but because of the atmosphere in the state of indiana. case in point, within indiana we have had the privilege of working with the indiana department of homeland security to complete mitigation plans in close collaboration with the counties and cities and towns in the state of indiana. the approach we take is highly collaborative. so unlike many situations where a plan is created and set aside on a shelf if you would that

plan becomes a living document. the community is engaged and people are brought to the table to discuss it. that is a critical component of making mitigation successful. part of the reason we are successful and something i am proud of is in the state of indiana we understand the importance of information. fema created a tool called has mh and it is a significant part of the portfolio we use. the technology that allows communities to estimate hazards are able to do that ma more successful way by integrating local resources. we have a hundred percent of the counties, even with disagreements, they managed to find a way to agree to share information. anywhere any time can go out to

the indiana map and download everything partial with road information and hazard information. that information combined with other resources in the state make it possible for our citizens to be better protected and much better able to respond to disasters than others might be. we have taken that success story, i am proud to say to other states as well. we are very much about building capacity. we have worked in the states of georgia and west virginia and many other areas. in total, we have worked in over 36 states including everyone i believe represented by members of this committee and over a hundred cities. building capacity means building tools and workloads and very importantly education and not just in doing hazard analysis but also what it means for a community in terms of long-term resilien resilience. we believe in connecting the fabric to the community of the solutions. so hunger, homelessness, and issues like that are just as

important in understanding how a community will or will not be resilient to a disaster and understanding if the building will fall down or stay upright. we look at those things and try to bring together the conversations to allow people to take advantage of that knowledge. >> thank you, sir. thank you, mr. chairman. i yield back. >> mr. ways? >> the bigger water 12 directs fema to incorporate stimulations of climate change in regards to estimates in regard to premiums. can you discuss how fema is doing that and how you are addressing uncertainties? >> we have been required to use the best science to determine the flood risk map and we continue to work with the scientific community and local communities to be able to identify what those potentials might be in the future in terms

of climate adaptation particularly are rising tides in flood zones. >> and so the question is how do you plan to address the uncertainties in regard to the models of the future sea rise and potential for storm intensity changes and things along those line. >> i will answer that for the record. another question, the technical mapping committee indicated in a recent report they believe there is about a 40% uncertainty rate associated with some of the flood models that were used. if you take that degree of uncertainty, which is extraordinary, and you put on top of it, trying to estimate future changes in sea rise, and future changes in the potential for storm intensity and frequency, it seems like we are

getting to a range of uncertainty that is no longer helpful to even use those types of models and predictive information. could you comment on that? >> yes, sir. i don't think we can go to the extent of not using model or predictive capability when trying to determine mitigation and preventive actions that need to be taken. while there is a certain degree of uncertainty we continue to use the best available information based on a wide range of scientific data that is available. is there uncertainty? there is always uncertainty but we have to start somewhere to be able to create a bases on which the risk exists in the community. as you know in your area, we just experienced floods in northern louisiana that no one would have expected based on the science that was there. so there is a great deal of uncertainty dealing with any weather event. we need to find the best science

at the time that creates the risk map and come back and reevaluate that as often as possible. >> i conquer we need to use the best information we can in regard to informing decisions but there is consequences of determining flood maps and with the 500 year flood risk management there could be significant and financial implications. my point is that having such severe implications but so much uncertainty with the predictive models isn't a comfortable combination of issues. i want to urge as you move forward that you keep that in mind and that you need to keep in mind there is a liability of information in models and take into account the consideration of financial implications on counties, perishes and others. director koon, i know a number of people that know you and you have a great reputation and

thunk for being here and i appreciate your testimony. a week before last, the house of representati representatives passed hr 21 and mr. nelson i will ask you a question on this. that bill allows for private flood insurance to serve effectively as a surrogate for to nfit. sounds like a good idea and the private sector could be more efficient man government in many cases so face value sounds good. however, being from your area and area i was born in, i am concerned we will see private insu insui insurers coming in and cherry picking and you are left with the policies that have higher risks. now, bigger water 12 and revisions from 2014 require that

the loan given to the nfit following the 2015 floods be repaid and a reserve fund is required to be established and rates be charged under flood insurance. the private sector insurance companies will not have the same financial burdens. they will have whatever policies they chose. the nfip has a smaller pool now because the private sector is pulling some off. so you will have the higher risk, smaller pool that is still subjected to establishing a reserve fund, paying off the debt of whatever it is, 17 billion dollars, are those concerns? am i -- should i not be concerned about this? is there something there we should be concerned about? is there something more comprehensive than hr-21? >> i think the debt is closer to 23 billion on the national flood insurance program.

i think they would like to get to 17 billion. my opinion is there needs to be more comprehensive reform of the national flood insurance program and i would urge this committee to become engaged with the is up for option next year. there are lots of components of the program that i think directly relate to the conversation we are having today with regard to mitigation activities that can take place across the country. one thing i address frequently in the state of florida, and did so before the governor's hurricane conference, as a result of the actions during bigger waters, we have seen a significant reduction in the number of flood policies and particularly in the state of florida which lost 10%. we went north of two million in the state to 1.8 million. that means those citizens, the next time they have a disaster or a flood in their community,

they will not be able to recover like they would have with flood inches and an additional cost is imposed upon the federal government because they may be eligible for assistance from fema. so a comprehensive analysis and reform of the national flood insurance program i believe is appropriate at this time. florida did do things to reduce the regulatory burden in the state of florida. there is probably 2-3,000 private flood insurance policies in the state but it is a start. i do share your concern about the cherry picking aspects and i am not an insurance expert but we had a similar situation in the state of florida with the citizens insurance company and the wind borne insurance. they have depopulated a large

section of their policy to the public market. i believe, mr. nelson, may be able to elaborate own that. i believe comprehensive reform of the national flood insurance program is absolutely appropriate and can tie in the mitigation activities we have discussed thus far. >> thank you. first, let me say i would echo the concerns you are raising. i think they are profound issues we have to evaluate. >> mr. chairman, for the record, i want to note he called me profound. >> yes. i do think if you step back -- travelers writes flood insurance on a commercial bases. we do not write home owners flood insurance and have no plans to enter that market. we don't have a formalized position on this. i would express my own points of view. i looked at a lot of fema rate plans and i think they need to modernize the rate plan.

the private industy shouldn't be based on the price. we have to have a pool of money and that is the shareholders money so they need a return on that. we should not be able to complete with fema. you step back and the plan needs to be modernized. it is not consistent with how the private sector looked as insurance, sells insurance, and has a rating plan. let's start with that. let's modernize the program and evaluate how we can prive privatize to look into the cherry picking. >> i think mr. graves made a good point that congress needs to look across the federal government including levies when we try to bend the cost curve of disasters. the disaster cost study in our fema authorization bill should help make such recommendations to congress.

i also want to thank the administer for the disaster deduc deductible proposal. i don't know if is the right solution but we need a vigorous debate if we are going to drive down losses and not just shift the cost between payers. i want to thank you for your testimony and comments. if there are no further question i would ask consent today's hearing remains open until they answers questions submitted and unanimous consent the record is open for 15 additional days for comments or information to be included in the record. without objection so ordered. i would like to thank witnesses for their testimony today. if no members have anything to add the subcommittee stands a o adjourned.

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